The Customer Load Active System Services (CLASS) project being undertaken by ENWL was due for completion at the end of September, a deadline which the network met. ENWL then requested an extension from the regulator on 4 November.
The project will now run until 31 May 2016 and will add a further £622,000 cost to the overall project.
The CLASS project is trialling the application of voltage management technologies which could potentially use demand response to reduce peak demand, and provide a new mechanism for frequency and voltage control to the National Electricity Transmission System Operator (NETSO).
ENWL provided evidence of £50 million worth per annum of potential benefits to customers in its project closedown report at the scheduled close of project at the end of September.
The additional £622,000 cost of the project extension will be accommodated within the total originally set out in the Project Direction.
ENWL will use the extension to provide further information on how the savings can be shared with customers, undertake a range of market modelling exercises and demonstrate how the proven technology can be commercially deployed commercially by other DNOs.
Ofgem said: “We consider it is in the best interests of customers and appropriate in the circumstances to approve these changes. The changes offer additional customer benefits while remaining within the original budget.
Electricity North West’s head of engineering Steve Cox said: “Ofgem’s decision is great news. The CLASS project successfully demonstrated that we can increase capacity and reduce demand by controlling voltage on the electricity network.
“The extra time and funding means we can assess the market and the regulatory implications of deploying CLASS more widely, and deliver the benefits to customers across Great Britain.”